Mechanics of Construction Law Update
Mechanics of Construction Law: New Notice Requirements for Lessors of Movables on Louisiana Construction Projects
Vol 1, Issue 4
Effective January 1, 2020, new notice requirements will be imposed upon lessors of movables prior to liening private construction projects for outstanding rent for movables (ie – equipment) used on projects. During the 2019 Regular Session, the Louisiana Legislature passed House Bill 203 which substantially relaxed the rather onerous notice requirements previously imposed upon lessors of movables used on construction projects. Under the prior law, a lessor was required to give notice, signed by both the lessor and lessee, to the owner and contractor within ten days after the lessor’s movables were first placed on the project. Failure to provide the notice was a bar to lien rights for the entire project.
Under the 2020 revisions, a lessor of movables needs only to provide notice that the lessor has leased or intends to lease movables to a contractor or subcontractor for use on the project. While the notice should provide a general description of the leased movables, it does not need to state the terms of the lease, or identify the leased movables with specificity. There is also no longer a deadline for sending the notice, but rather, if the notice is provided 30 days after the movables are placed on the project, the lien is limited to rents accruing after the date of notice. La. R.S. 9:4804(B)(1).